Unlimited Data Plans: 6 Things You Need to Know

man holding smartphone and smiling

Source: iStock

It’s no secret that subscribing to what a carrier refers to as an unlimited data plan is no guarantee that you’ll actually get unlimited data. And while many carriers stopped offering unlimited plans to new subscribers quite some time ago, others are resurrecting their unlimited data options, or are continuing to offer them to existing subscribers or those who are grandfathered in to discontinued plans. Even though there are a few interesting options for consumers who want an unlimited data plan, there’s also a lot of false advertising you need to see through and deceptive practices you to watch out for.

For instance, it’s unclear whether data caps are even necessary for mobile networks. As Jeremy Gillula reported for the Electronic Frontier Foundation, all discussions of throttling and data caps, whether you’re on an unlimited plan or not, operate on the assumption that data caps are necessary for mobile networks. “Zero-rating only makes sense when there’s a cap for data to be exempt from,” Gillula writes. “And even if you accept that data caps are necessary, whether or not zero-rating is a neutral practice is a completely separate question.”

Even if your data plan doesn’t have a traditional data cap, and instead just throttles your speed once you reach a certain amount of data, that’s still a limit on your data usage. Want to find out what other caveats you need to be aware of when shopping for an unlimited data plan? Here are seven important things to keep in mind as you look for the perfect plan.

1. Most unlimited data plans aren’t really unlimited

An unlimited data plan really doesn’t offer unlimited high-speed data. You have to look at your contract to find out the details, but most carriers set an amount of data that will be accessible at high speeds. After that, any additional data that you use will be throttled, which means its speed will be slowed down. As Ina Fried reported for Re/Code early in 2015, the Federal Trade Commission ruled that TracFone had to pay a $40 million fine for throttling speeds for customers who paid for unlimited data service. While the case was specific to TracFone, there are plenty of other carriers that still offer unlimited data plans but have been slowing down speeds for customers who subscribe to those plans. Later in 2015, the Federal Communications Commission announced plans to fine AT&T $100 million for misleading subscribers about its unlimited data plans, and failing to tell them that their speeds could be slower than those offered to other customers.

2. Unlimited data plans often have hidden requirements

David Ramos/Getty Images

David Ramos/Getty Images

Ina Fried reported for Re/Code in January that AT&T was resurrecting unlimited data plans in order to get more people to commit to AT&T for both cellphone and television service. (The plans, which are available to new and existing subscribers, require subscribers to sign up for both.) T-Mobile and Sprint still offer unlimited data options, though T-Mobile pushes subscribers toward tiered-rate data plans and Sprint has been raising rates for its unlimited data plans. Verizon stopped offering unlimited data plans to new customers back in 2011, and existing subscribers can only keep their unlimited plans by purchasing their new phones at full price. When signing up for an unlimited data plan, you need to read the fine print and figure out what phone you’ll be allowed to use and how you’ll be allowed to pay for it.

3. Carriers are charging more for their unlimited data plans

Lluis Gene/AFP/Getty Images

Lluis Gene/AFP/Getty Images

Beginning in October 2015, the price of Sprint’s unlimited data plans increased by $10, going up from a $60 monthly rate to a $7o per month charge. Existing customers on the $60 plan were able to remain on the plan even after the price increase “as long as they still meet the plan requirements and are purchasing a phone option and financing option that is compatible with the plan.” Whether you’re currently on an unlimited data plan or are shopping for one to switch to, you should pay attention to price increases and be prepared to shell out more each month than you would have a year or two ago. As with any data plan, it pays to figure out how much data you really need and compare all of your options. A tool like Whistleout is a good resource for comparing the options.

4. Unlimited data plans may not be worth it unless you’re actually a heavy user

Josep Lago/AFP/Getty Images

Josep Lago/AFP/Getty Images

While it sounds like a great idea to pay a set monthly fee and get as much data as you want, unlimited data plans aren’t always worth the extra cost. While it’s true that you can end up using a lot of data in a month, particularly if you’re using a 4G-enabled device on a fast network, many users can find plans that offer enough data at a lower price tag than that associated with an unlimited data plan. Again, you need to figure out how much data you really need to determine whether the added cost of an unlimited data plan is worth it, or if you’d be better off with a different plan.

5. You may not be able to use a lot of data for a mobile hotspot

Josep Lago/AFP/Getty Images

Josep Lago/AFP/Getty Images

Outspoken T-Mobile chief executive John Legere made quite a splash last year by promising to “eliminate” customers who abuse unlimited data plans. He wasn’t talking about customers who simply use lots of data by scrolling through Facebook, watching videos online, or uploading photos to Instagram. Instead, he was talking about going after unlimited data plan subscribers who use more than their allotted amount of data for tethering (even though the carrier already had measures in place to prevent heavy data users from impacting the experience of other subscribers). Some carriers forbid using your phone as a hotspot, charge you extra for the option, or limit how much data you can use for tethering. So if you’re planning on subscribing to an unlimited data plan to set up a mobile hotspot, you may want to rethink your strategy (particularly if you were eyeing a T-Mobile plan).

6. Zero-rating programs are another source of throttling

Josep Lago/AFP/Getty Images

Josep Lago/AFP/Getty Images

Through its BingeOn service, T-Mobile is offering its customers unlimited video streaming. However, it’s limiting the speeds and video quality that users get, and throttling all videos to around 1.5Mbps, whether or not the video provider is enrolled in Binge On. And contrary to its marketing around the service, T-Mobile doesn’t optimize the video streams, and instead caps all video streams even when the LTE connection and the rest of the carrier’s network can support higher throughput. Even if you aren’t using enough data for your carrier to throttle your speeds, pay attention to the other services that could be affecting the speed of your activities.

More from Gear & Style Cheat Sheet:

More from The Cheat Sheet